Plan to privatize part of Florida Medicaid gets approved

Nearly two years after the Florida Legislature approved an ambitious plan to place 3 million Medicaid patients in the hands of for-profit health care management companies, the federal government has given the go-ahead for one segment of the plan — affecting all the state’s elders who need long-term care.

More than 60 percent of Florida’s 72,000 nursing home residents rely on Medicaid to pay for their daily care. The federal waiver approved late Friday will allow Florida to enroll patients who require long-term care into managed care programs — mostly health maintenance organizations, or HMOs — that will offer services in their home or other community programs.

(Shutterstock photo)

State lawmakers anxious to rein in Medicaid’s rising strain on the state budget made reforming the joint state-federal program a priority in the 2011 legislative session. Supporters of the change to long-term care have promised savings of up to 30 percent, under the theory that home care will be less costly than skilled nursing facilities. But opponents counter that no data bolsters this claim, and that the experiment will put Florida’s elders in jeopardy.

According to a rollout schedule announced in mid-January, the state Agency for Healthcare Administration will first implement the transition for elderly long-term care patients in the Orlando area, beginning in August. The program is expected to expand to the Medicaid region that includes Sarasota and Charlotte counties in September, and to Manatee County in March 2014.

The 2011 law calls for placing all Medicaid beneficiaries into privatized plans — with long-term care patients enrolled first, and full statewide enrollment in private or hospital networks by October 2014 — just before the next gubernatorial election. Gov. Rick Scott noted Monday he is awaiting a final signoff from the federal Centers for Medicare and Medicaid Services on the full conversion plan.

U.S. Health and Human Services Secretary Kathleen Sebelius approved the long-term care portion of the request. At a meeting in Washington last month, Scott asked her to act quickly on the statewide request so Florida lawmakers can figure out how it will affect their plans to implement The Affordable Care Act.

“We need HHS’s immediate action to determine what flexibility we will have within our current Medicaid program and its impacts on the cost, quality and access to health care. Our state is facing unprecedented decisions that demand unprecedented attention from federal health officials,” Scott said in a statement.

At public workshops around the state before the Medicaid transition plan was finalized, health care providers and elder law attorneys criticized the new law — especially its so-called “granny-dumping” provision, which offers the for-profit providers incentives to discharge patients from long-term care facilities into the community. They said sufficient community resources do not exist.

But the federal government’s decision came as no surprise to Florida’s nursing home operators, said Kristen Knapp, communications director for the Florida Health Care Association, a nursing home industry group.

“We have been proceeding with keeping our members informed as if CMS would be approving the waiver,” she said Monday. “As the program begins to take shape, we’ll continue to work with the Agency for Health Care Administration and the selected HMOS through the transition to ensure that long-term care residents continue receiving the appropriate care in a high-quality setting.”

Jeff Johnson, the state director for the senior advocacy group AARP, also pledged to monitor the program’s rollout.

“Florida embarks now on a reform that is crucial to the lives and care of tens of thousands of frail and vulnerable Floridians,” Johnson said in a statement. “Florida elected officials have said they are pushing this reform effort forward because they want to assure the highest quality of care for frail and vulnerable Floridians under Medicaid. AARP Florida will hold them to their word.”

The number of Medicaid patients enrolled in for-profit managed care groups has quietly expanded since the 1990s, as states looked for ways to keep a lid on costs. Florida has a pilot program in five counties where Medicaid patients can be required to be part of an HMO. But another 1 million Floridians — about a third of the state’s total Medicaid population — are already “voluntarily” enrolled in managed care. The number has risen by 20 percent in the last three years alone. These patients have the right to opt out of the program where they are automatically assigned, but it requires an extra step and the process can be confusing for many Medicaid patients.

Manatee County has more than 26,000 Medicaid patients in managed care. In Sarasota County, there are 19,000, and Charlotte County has 3,915 Medicaid recipients in for-profit plans.

Over time, the managed care industry has taken control of this ‘auto-assignment’ process, with at least 65 percent of the auto-assigned placed in managed care plans — mostly HMOs. This has helped inflate the ranks of managed care enrollees in the non-pilot counties,” said Greg Mellowe, policy director for the patient advocacy group Florida CHAIN.

The federal decision comes as the GOP-controlled Legislature is playing a catch-up of sorts on implementing the federal health overhaul. Florida led the way in challenging the constitutionality of the Affordable Care Act. Some Democrats are now accusing state agencies of not having a Plan B in case the law was upheld, leading lawmakers to make crucial decisions on tight deadlines.

For now, it appears Florida will allow federal health officials to run an online state exchange, where consumers can shop for health insurance.

Florida must also decide whether to expand Medicaid under the federal health overhaul and offer health insurance to an additional roughly 900,000 residents.

Meanwhile, the state is waiting on the feds to sign off on the statewide privatization request.

Information from The Associated Press was used in this report.

Barbara Peters Smith

Barbara Peters Smith covers aging issues for the Sarasota Herald Tribune. She can be reached by email or call (941) 361-4936.

Last modified: September 30, 2013
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